The benefits of benefits

Standard

Can spending $6,850.00 a year be less than spending $6,000.00 a year? Can spending $5,000.00 a year be less than spending $3,000.00 a year? These are the sorts of questions that annual benefit enrollment can make one ask and also try to make seem logical.

Two High Deductible Plans

The comparison is two high deductible health plans. One with a higher deductible but a lower premium. Higher deductible with higher copay once deductible met, but both plans with relatively close out of pocket maximums for the year.

First plan, current one:

Lower deductible of $3,000.00

Total Premiums for year: $2,536.56

Total Personal HSA contributions: $2,307.60

Next Year’s Premiums: $3,779.88

Increase of 49% in premiums

With company HSA of $1,000.00 total contributions of $3,307.60

Copay after deductible of $10%

Alternate Plan (with expectations of spending same amount between premiuns and HSA)

Highest deductible of $5,000.00:

Total Premiums for year: $2,556.06

Total Personal HSA contributions: $2,307.60 + 1,223.82 = $3,531.42

With company HSA of $1,000.00 total contributions of $4,531.42

Copay after deductible of $30%

If we don’t use the full deductible, we will save more money on the higher deductible policy, but if we reach the deductible the lower policy will be more beneficial.

The $307.60 in HSA past the deductible on the first plan will cover $3,076.00 in total medical bills with the $10% copay.

The other question, of course, is how the services compare. From the summary sheet they seem to cover similar things, but the higher deductible seems to require more preapprovals of things.

The one thing I have learned from the current high deductible program, is that the companies negotiate rates with the providers. so different companies will get different rates from the same providers. How do I know which company gets the better deals from the providers I regularly use?

Where do I feel the most risk, and where am I willing to take the most risk?